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REAGAN TO ADDRESS NATION WEDNESDAY NIGHT

White House Chief of Staff Howard Baker said President Reagan will address the nation in a nationally televised speech Wednesday night at 2100 EST on the Tower Commission Report on the arms to Iran scandal. Baker, in his first news conference as chief of staff, also said that Robert Gates asked that his name be withdrawn from nomination as director of the Central Intelligence Agency. Gates said in a letter to the president that it became apparent it would be a long and difficult process to win Senate confirmation of the nomination. Reuter 

CANADA GOVERNMENT SPENDING TO RISE 3.8 PCT

The federal government's expenditures will rise 3.8 pct in the fiscal year beginning April 1 to 110.14 billion dlrs from 107.01 billion dlrs in fiscal 1987, the Treasury Board said. The board noted the growth in the main estimates is the lowest since 1962, and below last year's 3.9 pct increase. After inclusion of two special accounts, an unemployment insurance fund and a grain stabilization fund, total expenditures amount to 122.55 billion dlrs, the same as the estimate in the government's budget last month. The budget also estimated a deficit of 29.3 billion dlrs for fiscal 1988. Reuter 

ADVANCE CIRCUITS <ADVC> GETS LOAN AGREEMENT

Advance Circuits Inc said it has signed a 9,500,000 dlrs borrowing agreement with Washington Square Capital Inc. The new loan consists of a revolving credit facility of seven mln dlrs based on accounts receivable and a term loan of 2,500,000. The interst rate on the loans is 2.75 pct over the prime rate, with future rate reductions scheduled if certain income levels are achieved. It said the entire loan is due March 1990, with monthly payments of 29,800 due on the term loan. The money was used to completely repay its debt to First National Bank of St. Paul. It would not say how much that was. The bank took a discount on its gross amount and accepted 125,000 shares of Class C preferred stock which is convertible into 375,000 shares of common. Reuter 

BAKER SAYS REAGAN TO MEET PRESS "VERY SOON"

White House Chief of Staff Howard Baker said President Reagan will meet the press "very soon." Baker told a brief news conference "I expect you'll see the president very soon" when asked by reporters when Reagan expected to resume his news conferences. Reagan has not met the press since November 19. Baker said Reagan had intended to conduct today's news conference and only the lack of a firm announcement of a replacement for Robert Gates as CIA director prevented him. Reagan will address the nation wednesday night in response to the Tower Commission's report on the Iran arms scandal. reuter 

TEXAS AIR <TEX> UNIT TO BEGIN NEW SERVICE

Texas Air Corp's Eastern Airlines said it will offer low fare, night-time service from Chicago's O'Hare International Airport to 18 U.S. cities. It had previously offered similar service out of Houston. The company said one-way fares range from 39 dlrs to St. Louis to 89 dlrs to Los Angeles, San Francisco and other cities. They are available at all times with no restrictions. Flights depart between 0100 and 0415 CST and arrive around 0600 local time. Normal baggage checking services are not available because the flights carry air freight cargo so passengers are limited to two pieces of carry-on baggage. Reuter 

TONKA <TKA> EXPANDS AUSTRALIAN OPERATIONS

Tonka Corp said it agreed to become the exclusive distributor of Tokyo-based Bandai Co Ltd toy lines in Australia and New Zealand and also agreed to buy the business of Bandai Australia. Terms of the transaction were not disclosed. The Bandai agreement and other actions are expected to add 15 mln dlrs to Tonka's international sales in 1987. International sales accounted for 11 pct of Tonka's 293.4 mln dlrs of revenues in 1986. Reuter 

BARNETT BANKS OF FLORIDA <BBF> REDEEMS STOCK

Barnett Banks of Florida Inc called for redemption of all outstanding shares of its Series E 4.25 dlrs cumulative convertible preferred stock. The company said the redemption date will be May 8, 1987. Under the terms of the redemption, shareholders may convert or redeem their shares. The bank said shares may be converted into 2.25 shares of Barnett common stock if surrenderred by April 23. Shares surrendered after will be redeemed for 51.50 dlrs per share plus dividends accured through May 8, the bank said. Reuter 

HECK'S <HEX> SAYS CREDIT AGREEMENT EXPIRED

Heck's Inc said that its credit agreement with a group of banks expired on February 28 and that the banks are demanding payment on the loans. Heck's, which did not disclose the amount being sought by the banks, said it is holding discussions with its lenders that should be completed sometime this week. Heck's added, however, that it could not predict whether a new credit agreement will be reached. Reuter 

TURNER CORP <TUR> UNIT BUILDS HOSPITAL ADDITION

The Turner Corp's construction company New York said its Orange County office has begun building a 23 mln dlr addition to Kaiser Permanente Medical Center. The five-story, 197,000 square foot adition will be used primarily as an outpatient treatment clinic, it said. Developer for the project is Kaiser Foundation Hospitals in Pasadena, Calif., the company said. The completion date is October 1988, according to the company. Reuter 

GREY ADVERTISING <GREY> FORMS NEW DIVISION

Grey Advertising Inc's GreyCom Inc subsidiary said it established a new division GreyCom Corporate and Financial. Reuter 

MFS MANAGED MUNCIPAL BOND TRUST SETS PAYOUT

<MFS Managed Muncipal Trust Bond> said it declared a monthly payout income distribution of 5.7 cts a share compared with 5.6 cts for the previous month. It said the distribution is payable March 20 to shareholders of record March two. Reuter 

COMMERCIAL CREDIT <CCC> SELLS 10-YEAR NOTES

Commercial Credit Co is raising 150 mln dlrs through an offering of notes due 1997 yielding 8.217 pct, said lead manager Morgan Stanley and Co Inc. The notes have an 8-1/8 pct coupon and were priced at 99.375 to yield 105 basis points more than comparable Treasury securities. Non-callable for life, the issue is rated Baa-2 by Moody's and BBB-plus by Standard and Poor's. First Boston Corp and Shearson Lehman Brothers Inc co-managed the deal. Reuter 

ATT <ATT> GETS 57.3 MLN DLR CONTRACT

American Telephone and Telegraph Co has received a 57.3 mln dlr contract to develop laboratory equipment for an Enhanced Modular Signal Processor, the Navy said. reuter 

AMC <AMO> EXTENDS INCENTIVE PROGRAM

American Motors Corp said it is offering up to 700 dlrs on 1986 and 1987 Jeep Cherokee and Wagoneer vehicles bought until March 31. Rebates are 700 dlrs for two-door vehicles and 500 dlrs on four-door models. This is the first time cash rebates are available on these two Jeeps, a spokesman said. Not included is the 1987 Jeep Cherokee Limited. The expanded program is intended to keep AMC competitive in the marketplace and enable it to maintain its sales momentum with Jeep products, said William Enockson, group vice president, North American sales and marketing. AMC continues to offer low-interest rate-loans on most new 1986 and 1987 Jeep Comanche models from 2.9 pct for 24 month loans up to 9.9 pct on 60 month loans. These loans are available until March 31. AMC has been offering up to 500 dlrs rebates on its 1986 Encore and Alliance cars and 1987 Alliance and GTA models, the spokesman said. Reuter 

ADVANCED SYSTEMS <ASY> TO DISTRIBUTE COURSES

Advanced Systems Inc said it acquired distribution rights to three interactive video courses developed by NCR Corp <NCR>. The three courses, for data processing professionals and bankers, are delivered through interactive video, which combines video discs, personal computers and touch-screen monitors. Reuter 

U.S. BRASS MILL COPPER STOCKS LOWER IN JANUARY

U.S. brass mill copper stocks fell to 185,400 short tons (copper content) at the end of January from 191,200 short tons at the end of December, according to the American Bureau of Metal Statistics. Consumption by brass mills increased to 60,700 short tons in January from 48,900 short tons in December. Mills consumed 29,600 tons of refinery shapes in January versus 24,000 tons in December. Scrap consumption increased to 31,100 tons in January from 24,900 tons in December. Total brass mill shipments increased to 69,600 tons in January from 54,400 tons in December, while receipts rose to 63,800 tons from 47,100 tons. Reuter 

MFS MUNICIPAL INCOME TRUST <MFM> SETS PAYOUT

MFS Municipal Income Trust said it declared a monthly income distribution of 5.7 cts a share compared with 5.5 cts a share paid in the previous month. It said the distribution is payable March 27 to shareholders of record March 13. Reuter 

PITTWAY CORP <PRY> 4TH QTR NET

Shr 1.35 dlrs vs two dlrs Net 6,195,000 vs 9,202,000 Sales 157.5 mln vs 151.6 mln Year Shr 6.02 dlrs vs 6.78 dlrs Net 27,608,000 vs 31,117,000 Sales 585.7 mln vs 541.3 mln Reuter 

<SIEMENS AG> U.S UNIT TO BEGIN MAKING SYSTEMS

<Siemens AG's> U.S. subsidiary, Siemens Public Switching Systems Inc said two existing plants have been selected to allow immediate start up of manufacturing on an interim basis of EWSD digital central office switching systems in the U.S. The company said the two facilities, one in Cherry Hill, N.J., the other in Hauppauge, N.Y., will be used while a rigorous review process for selecting a facility devoted only to EWSD manufacturing continues. Siemens Public is part of Siemens Communication Systems Inc, also headquartered in Boca Raton. Reuter 

ARMTEK <ARM> TO SELL INDUSTRIAL TIRE UNIT

Armtek Corp, previously the Armstrong Rubber Co, said it agreed to sell its industrial tire and assembly division to a Dyneer Corp <DYR> for an undisclosed sum. It said the agreement covers the division's tire production facility in Clinton, Tenn., and its plants serving original equipment and replacement markets. Armstrong Tire Co, an Armtek unit, will continue to sell replacement industrial tires, the company said. Final closing is expected in the third fiscal quarter ending June 30. Reuter 

U.S. SIGNS TAX TREATY WITH VIRGIN ISLANDS

The Treasury Department said the United States and the Virgin Islands have signed a tax treaty to exchange tax information and provide mutual assistance in tax matters. The agreement was needed to trigger provisions of the Tax Reform Act of 1986 allowing the Virgin Islands to offer investment incentives by reducing Virgin Islands taxes on non-U.S. source income, the Treasury said. The treaty will be a model for similar agreements to be negotiated with three other U.S. possessions -- American Samoa, the Mariana Islands and Guam, the Treasury said. The new agreement, which expands and replaces a prior agreement with the Virgin Islands, was signed on February 24, the Treasury said. Reuter 

CME SETS FEBRUARY TRADING VOLUME RECORD

The Chicago Mercantile Exchange (CME) posted record trading volume for the month of February when 6,556,464 futures and options contracts changed hands, up 15.2 pct from last February's volume of 5,693,243 contracts. Interest rate futures trading was the most active segment at the exchange, with Eurodollar futures setting a monthly record of 1,472,184 contracts, up 78.4 pct, from volume of 825,087 contracts in February last year and surpassing the previous record of 1,288,729 contracts set in September, 1986. Options on Eurodollar futures also set a monthly record of 235,916 contracts, up 92.4 pct from 122,616 a year ago. Trading in currency futures and options at the CME fell 4.6 pct during February from a year ago, with 2,012,148 contracts changing hands compared to 2,119,198 contracts in the same period last year. Volume in most currency futures contracts fell in February, while options on the currency futures rose 28.2 pct. Options on mark futures set a monthly record at 273,749 contracts, up from the previous record of 268,831 contracts in January. Agricultural futures volume rose 17.1 pct during the month, with live hog futures volume leading the market segment, rising 27.7 pct to 138,543 contracts. Reuter 

SOFTWARE COS SUPPORT NEW APPLE <AAPL> PRODUCTS

Over 30 software companies announced programs to support Apple Computer Inc's new Macintosh II and Macintosh SE computers. At a seminar where the products were introduced, software makers such as Ashton-Tate <TATE>, Microsoft Corp <MSFT> and Lotus Development Corp <LOTS> announced new or existing products now accessible to the Macintosh computers. Lotus announced Lotus Galaxy, software that will deliver six programmable business modules, which it said will be formally introduced this summer. In addition, National Semiconductor <NSM> said it will provide a series of products for the Macintosh computers, including a 16-megabyte memory expansion module. Reuter 

AMERICAN ELECTRIC <AEP> UNIT REDEEMING BONDS

Appalachian Power Co, a unit of American Electric Power Co, said it will redeem on May one an additional 1.38 mln dlrs of its 12-7/8 pct first mortgage bonds due 2013. That increases to 2.88 mln dlrs the amount of bonds the utility will buy back. Appalachian Power said it will redeem the bonds at par plus accrued interest. Reuter 

AVX CORP <AVX> DEBT AFFIRMED BY S/P

Standard and Poor's Corp said it affirmed the B-plus rating on AVX Corp's 28 mln dlrs of subordinated debt. The company's implied senior debt rating is BB. S and P said AVX's purchase offer for CTS Corp <CTS> has expired and the acquisition does not appear likely to occur. AVX was listed on S and P's creditwatch with negative implications on December 17, 1986, because of the proposed acquisition. Reuter 

FDA OKAYS DRUG TO LESSEN HEMOPHILIACS' BLEEDING

The federal Food and Drug Administration said it approved for U.S. marketing a drug that reduces bleeding in hemophiliacs requiring dental work. The FDA said the drug, tranemaxic acid, would lessen and in some cases eliminate altogether the need for blood transfusions in hemophiliacs who must have teeth extracted. The drug will be made by Kabivitrum of Stockholm, Sweden and distributed here under the trade name Cyklokapron by Kabivitrum Inc of Alameda, Calif. Hemophilia is a hereditary diseease whose victims lack the particular proteins that promote blood clotting. Reuter 

KIDDER UNIT SELLS CMOS, INCLUDING FLOATERS

Kidder, Peabody Mortgage Assets Trust Five, a unit of Kidder, Peabody and Co Inc, is offering 500 mln dlrs of collateralized mortgage obligations in seven classes, including floating-rate and inverse-rate tranches. Sole manager Kidder Peabody said the first floating-rate class has an initial rate of 6.755 pct that will be reset quarterly at 40 basis points over three-month LIBOR, with an 11 pct cap. Totaling 53.3 mln dlrs, this floating-rate class contains a so-called catchup provision that allows investors to recapture possible lost interest, according to Kidder Peabody. For instance, if three-month LIBOR rises to 15 pct during the life of the floating-rate tranche and falls back below the 11 pct cap, investors would be paid back, dollar for dollar, the amount of interest they would have received if the CMOs did not carry a maximum interest rate, a Kidder officer said. Kidder Peabody introduced this concept on February 12. The other floating-rate class totals 132.4 mln dlrs and has an initial rate of 6.975 pct that will be reset quarterly at 60 basis points over three-month LIBOR, with a 13 pct cap. This tranche does not have a catch-up provision, the Kidder officer said. The inverse-rate tranche totals 71.3 mln dlrs and has an initial rate of 10.903 pct. The rate will be reset quarterly according to the formula of 22.44027 minus the product of 1.8097 times three-month LIBOR. Yields on the remaining fixed-rate CMOs, the balance of the 500 mln dlr issue, range from 7-1/4 to 9.27 pct, or 90 to 160 basis points over comparable Treasuries. The issue is rated a top-flight AAA by Standard and Poor's. Reuter 

PETROLITE CORP <PLIT> SETS PAYOUT

Qtly dividend 28 cts vs 28 cts Pay April 24 Record April 10 Reuter 

NYMEX TO SUBMIT PROPANE PROPOSAL TO CFTC

The New York Mercantile Exchange expects to submit a propane futures contract for federal regulatory approval within a few days, according to an exchange spokeswoman. As previously announced, the Board of Governors of the exchange approved the contract last month. The exchange will now submit the contract to the Commodity Futures Trading Commission, according to the spokeswoman. Contract specifications will resemble those of heating oil and gasoline futures. The contract size will be 1,000 barrels, or 42,000 U.S. gallons. The minimum price fluctuation for the propane futures contract will be 0.01 cent per gallon, or 4.20 dlrs a barrel, according to the exchange. The maximum daily price limit will be two cts a gallon on all contracts except spot. Trading will terminate on the last business day of the month preceding the delivery month. The exchange said delivery will be F.O.B from the seller's pipeline, storage, or fractionation facility in Mont Belvieu, Texas, which has a direct pipeline access to the Texas Eastern Transmission Pipeline (TET) in Mont Beliview. Delivery method will be by in-line or in-well transfer, inter-facility transfer or pumpover, or book transfer and cannot be done earlier than the tenth calendar day of the delivery month, according to the exchange. Deliveries must be completed no later than two business days prior to the end of the delivery month. Buyers taking delivery of the propane must pay the seller by certified check and the deadline for payment is 1200 EST (noon) of the second business day following receipt of the propane. Reuter 

australian annual broad money supply growth 10.3 pct in January

GM FEBRUARY U.S. CAR OUTPUT 358,661, DOWN FROM 398,823 LAST YEAR

GM <GM> OUTPUT FELL LAST MONTH

General Motors Corp said its February U.S. car production declined to 358,661 from 398,823 a year ago. GM said its U.S. truck production declined to 128,099 from 135,434 a year ago. Year-to-date, GM said car output declined to 669,370 from 839,097 and truck production eased to 250,999 from 279,181. Reuter 

YEUTTER BLASTS PROPOSED EC OILS AND FATS TAX

U.S. trade representative Clayton Yeutter today said that if the European Community's Council of Ministers approves a tax on vegetable oils and fats, another major transatlantic trade row will erupt over agriculture. In a statement issued by the trade representative's office following a speech to the American Soybean Association's board of directors, Yeutter said the proposed tax would have a severe impact on American soybean farmers, who export some 2.4 billion dlrs in soybeans and products annually to the EC. "This is an unacceptable situation for us and its (vegetable oils tax) enactment would leave us no choice but to vigorously protect our trade rights and defend our access to the European market," Yeutter said. Yeutter said the proposed vegetable oils tax would violate EC obligations under the GATT. He said the effect of the tax would be to double the price of soyoil produced from imported soybeans, making margarine made from soyoil more expensive than tallow-based margarine, and closer in price to expensive European butter. "I am astonished that the EC commission would propose such a provocative measure so soon after we successfully resolved the agricultural dispute over the enlargement of the EC to include Spain and Portugal," Yeutter said. "It serves no purpose to embark on another confrontational course before the recent wounds have healed and as we are beginning to make progress on the Uruaguay round (of global trade talks)," he said. Reuter 

EXXON <XON> CUTS HEATING OIL BARGE PRICE

Oil traders in New York said Exxon Corp's Exxon U.S.A. unit reduced the price it charges contract barge customers for heating oil in New York harbor 0.75 cent a gallon, effective today. They said the reduction brings Exxon's contract barge price to 43.25 cts. The price decrease follows sharp declines in heating oil prices on spot and futures markets, traders said. Reuter 

GREECE SAYS IT HAS RIGHT ON AEGEAN OIL DRILLING

Greece, responding to a warning by Turkey against conducting oil activities in the Aegean Sea, said today it had the right to decide where and how to do research or drilling work in the area. A government spokesman said the Greek position was made clear to Turkey's ambassador Nazmi Akiman when he met Greek Foreign Affairs Undersecretary Yannis Kapsis last week. Acting Turkish Prime Minister Kaya Erdem said earlier today Greek activities in the northern Aegean contravened the 1976 Berne Agreement which set the framework for talks on the Aegean continental shelf disputed between Ankara and Athens. The Greek statement today said, "Greece is not prepared to give up even a trace of its sovereignty rights to the seabed. It has been stressed to...Mr Akiman that the decision where or how to drill belongs exclusively to the Greek government." "The Greek government has repeatedly let the Turkish side know that it considers the 1976 Berne protocol as inactive through the fault of Turkey," it said. The Greek statement said Athens was ready to put the continental shelf issue before international courts. Reuter 

LEUCADIA <LUK> HAS 7.2 PCT OF MINSTAR <MNST>

Leucadia National Corp said two of its subsidiaries have acquired a 7.2 pct stake in Minstar Inc, a corporation controlled by corporate raider Irwin Jacobs and used by him in his forays to acquire stock in companies. In a filing with the Securities and Exchange Commission, Leucadia said its LNC Investments Inc, a Newark, Del., investment firm, and Charter National Life Insurance Co, a St. Louis joint stock life insurance company, bought their combined 1,261,000 Minstar common shares for investment purposes only. The Leucadia subsidiaries had held an 11.0 pct stake in Minstar, but cut to 1.8 pct, or 313,200 shares, last July. Since July, Leucadia said its companies have bought 947,800 Minstar common shares for a total of 24.7 mln dlrs. Leucadia said it bought the Minstar stake to obtain an equity position in the company and has no intention of seeking control of it. Nearly half of Leucadia's common stock is owned by TLC Associates, a Salt Lake City, Utah, general partnership, whose partners include the chairman and president of Leucadia and other investors. Reuter 

BASIX CORP <BAS> 4TH QTR LOSS

Oper shr loss eight cts vs profit 20 cts Oper net loss 768,000 vs profit 1,962,000 Revs 49.0 mln vs 43.6 mln 12 mths Oper shr loss 1.41 dlrs vs profit 96 cts Oper net loss 13.6 mln vs profit 9,305,000 Revs 175.3 mln vs 140.7 mln Note: Oper excludes loss from discontinued operations of 4,676,000 dlrs or 48 cts a share for year-ago qtr and 7,571,000 dlrs or 78 cts a share for year-ago 12 mths. Oper includes charge of 1.1 mln dlrs for cumulative effect of repeal of the investment tax credit for qtr and writedown of 21.6 mln dlrs on gas and oil facilities for 12 mths. Year-ago shr data restated to reflect two pct stock dividend of December 1986. Reuter 

MONTREAL EXCHANGE NAMES NEW PRESIDENT

The Montreal Exchange said it named Bruno Riverin, president of Quebec's Caisse centrale Desjardins, as its new president and chief executive officer. Riverin replaces former exchange president Andre Saumier, who resigned in January to set up a brokerage firm. Riverin's appointment is effective March 26, the exchange, Canada's second largest, said. The Caisse central is the main investment arm of Quebec's huge credit union movement. Reuter 

AUSTRALIAN JANUARY ANNUAL BROAD MONEY UP 10.3 PCT

Australia's broad money supply rose 10.3 pct in the year ended January, up from a revised 9.6 pct in December, the Reserve Bank said. This compares with the previous January's 13.9 pct. In January broad money growth slowed to 0.7 pct from December's 1.5 pct and compared with nil growth in January 1986. Within the broad money total, non-bank financial intermediaries rose by 0.2 pct from a revised decline of 0.2 in December and a previous January's 0.8 pct increase. In the January year, NBFI's borrowings rose by 9.5 pct from a revised 10.1 in December and compared with a previous January's 12.8. At the end of January, broad money stood at 175,866 mln dlrs dlrs from December's 174,668 mln dlrs and a January 1986 level of 159,453 mln. In the same period, borrowings from the private sector by the NBFIs rose to 70,389 mln dlrs from December's 70,237 mln and the previous January's 64,299 mln. Reuter 

MICROBIO <MRC> PLANS ACQUISITION, FINANCING

Microbiological Research Corp said it entered into a letter of intent for a proposed business combination with privately owned <DataGene Scientific Laboratories Inc>, and <Milex Corp> a newly formed company, through a stock swap. It also said it received 100,000 dlrs from the sale of a convertible note to Ventana Growth Fund as part of an overall 1,100,000 equity financing plan with Ventana. Under that plan, a minimum of 400,000 dlrs and a maximum of one mln dlrs of additional new capital is to be provided to fund the combined operations of the three companies. Microbiological also said that if the maximum additional capital is raised, it will own about 49 pct of 4,550,00 shares of common outstanding in the new combined company, DataGene holders will own 29 pct, and Ventana and others will own 13 pct. It said the remaining nine pct will be held by Milex shareholder Norman Monson, who will become chief executive officer of the combined companies. Reuter 

NATIONAL BANK ISSUES MORTGAGE-BACKED SECURITIES

<National Bank of Canada> said it is issuing 25 mln dlrs worth of mortgage-backed securities recognized by the federal government's Canada Mortgage and Housing Corp. The bank said the issue is divided into two pools--one bearing annual interest of 8-3/4 pct and the other 8-5/8 pct, with interest calculated semi-annually and paid monthly. It said the securities are available in denominations of 5,000 dlrs for a term of slightly less than five years. Underwriters are (Levesque, Beaubien Inc), and (McLeod Young Weir Ltd). National Bank said the issue is part of a program by Canada Mortgage and Housing, introduced late last year, which provides investors with high quality securities similar to government bonds but with a higher rate of return. Reuter 

ICO COUNCIL ENDS IN FAILURE TO AGREE QUOTAS

A special meeting of the International Coffee Organization (ICO) council failed to agree on how to set coffee export quotas, ICO delegates said. Producers and consumers could not find common ground on the issue of quota distribution in eight days of arduous, often heated talks, delegates said. Export quotas -- the major device of the International Coffee Agreement to stabilise prices -- were suspended a year ago after coffee prices soared in reaction to a drought in Brazil which cut its output by two thirds. Delegates and industry representatives predicted coffee prices could plummet more than 100 stg a tonne to new four year lows tomorrow in response to the results of the meeting. Reuter 

FRANCE HAS LITTLE ROOM FOR MANOEUVRE, OECD SAYS

French industry is failing to produce the goods its markets need and its loss of competitiveness has left the government little room for manoeuvre to reflate the economy, the Organisation for Economic Cooperation and Development said. With gross domestic product likely to grow only 2.1 pct this year, the same rate as last year, unemployment could climb to 11.5 pct of the workforce by mid-1988, from its present 10.9 pct, it said in an annual review of the French economy. The report said the French economy was "increasingly ill-adapted to demand" selling goods at "uncompetitive relative prices on both domestic and export markets." "France's poor export performance reflects a geographical bias in favour of markets less dynamic than the average... And...A substantial loss of market share...In the past 18 months," it said. Pointing to a likely widening of the French trade deficit to around 2.9 billion dlrs this year from 2.4 billion in 1986, it warned that a further depreciation of the dollar against the franc could lead to "a (renewed) loss of competitiveness relative not only to the United States but also to the newly industrialised countries." This could result in further major losses of market share, particularly in the non-OECD area, which accounts for almost a quarter of French exports, it said. Until the competitive ability of industry improved, the authorities would have "little scope for macroeconomic manoeuvre, even if the unemployment situation or the need to encourage a pickup in investment could require demand to grow more briskly," it added. But rising unemployment could help to hold down wage demands, contributing to a slowdown in inflation to around a two pct annual rate this year and early next, the OECD said. Written mainly in December last year, the report took no account of a rise in oil prices early in 1987, and a 0.9 pct surge in January consumer prices, caused partly by the government's deregulation of service sector tariffs. "We took a bet that the freeing of prices would not provoke runaway rises, and it is not absolutely certain that bet has been lost," one OECD official commented. OECD officials said the January data and a rise in oil prices above the 15 dlrs a barrel average assumed in the report, indicated an upward revision in the inflation forecast to around 2.5 or three pct. The government last week revised its forecast up to between 2.4 and 2.5 pct from two pct, against last year's 2.1 pct. But the OECD backed the government's view that the underlying trend for inflation remained downwards this year, with a slowdown in domestic costs taking over from last year's fall in oil and commodity prices as the chief cause of disinflation. With French unit productivity costs now among the lowest in the OECD area, the inflation differential between France and its main trading rival, West Germany, could fall to just one pct this year, it said. On the other hand, the report noted, consumer prices for industrial goods and private services have been rising steeply as companies built up their profits. "For the disinflationary process to continue , and price competitiveness to become lastingly compatible with exchange rate stability, it is essential that wage restraint continue," it said. REUTER 

PAINEWEBBER<PWJ> UNIT UPS SHAER SHOE <SHS> STAKE

Mitchell Hutchins Asset Management Inc, a New York investment firm and subsidiary of PaineWebber Group Inc, said it raised its voting stake in Shaer Shoe Corp to 76,000 shares, or 7.5 pct, from 52,100 shares, or 5.1 pct. In a filing with the Securities and Exchange Commission, Mitchell Hutchins said it bought 11,900 shares between Jan 8 and Feb 24 at prices ranging from 12.125 to 12.75 dlrs a share and obtained voting control over another 12,000 shares. The firm has said it bought the stake as an investment on behalf of its clients, but said it has had discussions with Shaer management. It did not disclose the topic of the talks. Reuter 

ORACLE SYSTEMS CORP <ORCL> TO OFFER STOCK

Oracle Systems Corp said it plans to register with the Securities and Exchange Commission to offer two mln share of its common stock. If these shares, about 1.5 mln shares woll by sold by the company and up to 500,000 shares by be sold by certain shareholders. Oracle, which recently announced a two-for-one stock split, said it will have about 28 mln shares outstanding after the offering. Reuter 

TELECREDIT INC <TCRD> 3RD QTR JAN 31 NET

Shr 32 cts vs 22 cts Net 3,454,000 vs 2,224,000 Revs 33.2 mln vs 28.1 mln Nine mths Shr 64 cts vs 38 cts Net 6,935,000 vs 3,877,000 Revs 86.8 mln vs 70.9 mln Reuter 

COUSINS HOME FURNISHINGS <CUZZ> GET CREDIT LINE

Cousins Home Furnishings Inc said it obtained a 5.0-mln-dlr working capital line of credit from Lloyds Bank PLC, through its Los Angeles branch. The credit is supported by a guarantee from the company's Canadian affiliate, The Brick Warehouse Ltd, which will receive 200,000-dlrs worth of the company's stock. The line of credit, which expires in July, 1989, will be used to pay off a 1,750,000-dlr working capital loan the company owes Wells Farg Bank. Reuter 

LASER PRECISION CORP <LASR> 4TH QTR NET

Shr profit 14 cts vs profit two cts Net profit 452,723 vs profit 50,581 Revs 5,065,543 vs 2,898,363 Year Shr profit 45 cts vs loss 15 cts Net profit 1,276,472 vs loss 340,081 Revs 16.0 mln vs 9,304,466 Reuter 

REXNORD <REX> TO REDEEM RIGHTS

Rexnord Inc said it will redeem all of its preferred stock purchase rights for 10 cts a right effective today. Rexnord said the rights will be redeemed because it is expected its shares will be tendered under a January 30 takeover offer from Banner Acquisition Corp. The rights trade in tandem with Rexnord's common stock. Reuter 

CANTREX UNIT TO MERGE WITH ONTARIO GROUP

(Groupe Cantrex Inc) said it plans to merge a new wholly-owned subsidiary a merger agreement with (CAP Appliance Purchasers Inc), of Woodstock, Ontario, a group of about 400 appliance and electronics retailers. It said CAP shareholders will receive 140,700 first preferred Groupe Cantrex shares entitling the holders to receive 6.05 dlrs per share or the equivilant in class A subordinate voting Cantrex shares. The merger is effective April one and is subject to shareholder approval. Reuter 

INVESTMENT FIRM BOOSTS LDBRINKMAN <DBC> STAKE

Two affiliated investment firms and the investment funds they control said they raised their combined stake in LDBrinkman Corp to 653,600 shares, or 10.9 pct of the total outstanding from 585,600 shares, or 9.7 pct. In a filing with the Securities and Exchange Commission, Fidelity International Ltd, a Bermuda-based firm, said its funds bought 68,000 LDBrinkman common shares between Jan 5 and Feb 19 at prices ranging from 5.30 to 5.445 dlrs a share. Funds controlled by FMR Corp, a Boston-based investment firm affiliated with Fidelity, hold 251,100 shares, bringing the combined total to 653,600 shares, Fidelity said. Reuter 

ITT'S <ITT> HARTFORD UNIT POSTS 4TH QTR GAIN

Hartford Insurance Group, a unit of New York-based ITT Corp, said higher worldwide premiums help boost net income for the 1986 fourth quarter to 88.6 mln dlrs, from net income of 36.7 mln dlrs for the 1985 quarter. For the full year, Hartford said it earned 329 mln dlrs, up from 151.4 mln dlrs in 1985. Hartford said results for the year were aided by a gain of 46.5 mln dlrs on the sale of its remaining 52 pct stake in Abbey Life Group PLC. For 1985, the company posted a gain of 14.3 mln dlrs on the sale of 48 pct of Abbey Life. Hartford said total property-casualty and life-health written premiums rose 25 pct in 1986, to eight billion dlrs, from 6.4 billion dlrs in 1985. Reuter 

SEC PROBES 1986 TRE <TRE> TAKEOVER ATTEMPT

The federal Securities and Exchange Commission (SEC) is looking for possible securities laws violations in connection with an unsuccessful 1986 bid by Hollywood producer Burt Sugarman to take over TRE Corp, attorneys contacted by SEC investigators said. During the takeeover attempt, a unit of Sugarman's Giant Group Ltd at one point held a 9.9 pct stake in TRE. It had help in that effort from Jefferies Group Inc, a Los Angeles investment banking firm which sold it an option on a portion of the shares Sugarman eventually acquired. In addition, a company controlled by Sugarman raised 35 mln dlrs in a debt offering underwritten by Drexel Burnham Lambert Inc with help from Jefferies, and used a portion of the proceeds to buy TRE stock. Finally, Reliance Group Holdings Inc acquired nearly six pct of TRE, according to an SEEC filing. The attorneys, who asked not to be identified, said the SEC was investigating whether Sugarman and other firms with TRE holdings were working together without disclosing their cooperation, as would be required by the federal securities laws. One attorney said SEC probers also were examining whether Sugarman and Drexel had made adequate disclosures of its intended usage of the proceeds in the prospectus for the 35 mln dlr bond offering. A TRE spokesman confirmed that TRE, since December a unit of Aluminum Co of America, had been contacted by SEC investigators and was cooperating with the probe. The spokesman added that TRE Chairman Leopold Wyler had been interviewed by the SEC probers. A Jefferies spokesman said the SEC had asked for information a few months ago as part of an informal probe. The spokesman said Jefferies had cooperated with the agency and had heard nothing more since that time. "To the best of our knowledge, Jefferies is not the target of a formal SEC investigation" in connection with the TRE bid, he said. A Drexel spokesman acknowledged that his firm had underwritten the debt offering for Sugarman but added: "We had nothing to do with TRE." As a matter of policy, the SEC routinely declines to comment on its enforcement activities. Reuter 

REGAN DEPARTURE MAKES 3RD VOLCKER TERM LIKELY

Last week's White House shake-up has increased the odds that Federal Reserve Board chairman Paul Volcker, a symbol of strength in a government reeling from the arms-to-Iran scandal, will serve a third term, sources close to the Fed say. But they said that no decision on the appointment, which must be filled this August, has been taken by the White House and Volcker too has not made up his mind. Former White House Chief of Staff Donald Regan, who resigned last week when ex-senator Howard Baker was named as his replacement, was implacably opposed to Volcker and tried often to undermine him. It is an open secret in Washington that Regan tried to ensure that Volcker, first appointed in 1979 by President Carter, will not be offered a third term by President Reagan. Only Volcker's key allies in the Reagan administration, Vice-President George Bush and Treasury Secretary James Baker, kept Regan's recent maneuvering at bay, the sources said. Sources close to the administration say Regan leaked a story, quickly shot down by others in the administration, that Beryl Sprinkel, chairman of the council of economic advisers, had been chosen to replace Volcker. But as the administration's credibility was increasingly under fire, it became clear that Regan's power to bring about such changes was on the wane. The sources said New White House Chief of Staff Howard Baker has a very good relationship with his namesake at the Treasury Department and is likely to respect his views on the Fed chairmanship. As a moderate Republican, Baker is also unlikely to share the right-wing's opposition to Volcker. "This new White House is going to need all the strength it can get," said one source when asked about the possibility of Volcker's reappointment. Paul Volcker is deeply respected in financial markets both in the United States and around the world. At a time when the stability of the dollar and the viability of major debtor nations are in question, Volcker's departure would definitely undermine U.S. leadership, foreign exchange analysts say. U.S. officials say Volcker works very closely with Treasury Secretary Baker on issues like international debt and global economic cooperation. The two men seem only to differ on how far to deregulate the banking industry, but recent statements by Volcker, in which he adopted a more liberal attitude on deregulation, signalled the politically-independent central bank is coming around at least partially to the Treasury position. And a recent statement by a Reagan administration official that the two men saw "exactly eye-to-eye" on the dollar was seen as an indication of Baker's support for the Fed chairman. Baker is understood to have played a key role in Volcker's reappointment to the Fed in mid-1983. The sources said Baker respects Volcker and when appointed Treasury Secretary in February 1985, he decided to ensure a good working relationship, in part because he believed the two key government economic institutions have to work closely. Regan, Treasury Secretary during President Reagan's first term, was formerly head of Wall Street's largest brokerage firm Merrill Lynch and came to Washington determined to be America's pre-eminent economic spokesman. He developed a deep antipathy for Volcker, whose political skills undermined that ambition, and who financial markets took much more seriously. But the sources said Volcker would have to be invited to stay. "Is the president going to ask him? he wouldn't stay otherwise," said one. "He'd have to be asked," said Stephen Axilrod, formerly staff director of monetary policy at the Fed and now vice-chairman of Nikko Securities Co. International. Otherwise, the list of potential candidates is not awe-inspiring. And if Volcker left this Augsut, he would leave behind one of the most inexperienced Fed Boards in years. Many analysts believe this lack of collective experience -- the four sitting members were all appointed within the last three years -- is dangerous, coming at a time when the global economy is threatened by instability. An experienced successor, therefore, would seem a necessity. One widely mentioned possibility is Secretary of State George Shultz, whose experience as Treasury Secretary under Preesident Nixon and background as a trained economist would make him ideal. But Shultz too may have been damaged by the arms-to-Iran scandal, while vice-chairman Manuel Johnson is regarded at 37 years old as too young for the job. Other potential candidates include economist Alan Greenspan, frequently an informal presidential economic adviser, New York Fed President E. Gerald Corrigan, Federal Deposit Insurance Corp chairman William Seidman, and Sprinkel. Long a Regan protege, Sprinkel's chances may be damaged by his patron's departure from the White House. Reuter 

CBT FEBRUARY VOLUME DOWN 14 PCT FROM YEAR AGO

February volume at the Chicago Board of Trade, CBT, declined 14 pct from the year-ago month to 8,191,266 contracts, the exchange said. A relatively steady interest rate climate reduced volume in the most active contract, Treasury bond futures, by 17.5 pct from a year ago to 4,307,645 contracts. However, trading in most agricultural futures contracts increased last month, led by oats and corn futures. Oats volume tripled to 27,662 contracts, and corn volume increased 35 pct to 580,204 contracts. Wheat and soybean oil futures activity also rose from a year ago, while soybean and soybean oil volume slipped, the exchange said. Major Market Index futures increased activity 37 pct during the month with 194,697 contracts changing hands. Reuter 

USSR WHEAT BONUS RUMORS PERSIST DESPITE DENIALS

Grain trade representatives continued to speculate that the Reagan administration will offer subsidized wheat to the Soviet Union, while U.S. Agriculture Department officials said there was no substance to the reports. "It's pure fiction," said one senior official at USDA's Foreign Agricultural Service, referring to the rumor that the administration would make an export enhancement offer to Moscow in the next two to three weeks. An aide to Agriculture Secretary Richard Lyng who asked not to be identified said there was nothing to substantiate the speculation, which he said was started by "somebody fanning the (wheat) market." Wheat futures strengthened today, partly on the basis of the speculation. One lobbyist with close connections to the Reagan administration said a Soviet trade team told private grain trade officials in New York last week that Moscow would buy as much as four mln tonnes of U.S. wheat, much of it before mid-year, if it was "competitively priced." Alexander Ivlev, an official with Amtorg, a Soviet trading organization, told Reuters he had no information to substantiate the rumors of an imminent wheat subsidy offer, but said that Moscow "would consider" buying U.S. wheat if it was competitively priced. "We don't care if it is EEP, what we (the Soviets) are looking for is competitive prices," Ivlev said. "If they (the administration) are interested in selling it (wheat), they should find ways to do it." Reuter 

CANADIAN SEAFARERS THREATEN STRIKE

Canadian seafarers are almost certain to go on strike this spring in a refusal to meet rollbacks in wages and benefits asked for by their employers, Seafarers' International Union official Roman Gralewicz said. "It's 99.9 percent--I guarantee you a strike," Gralewicz said in an interview. The union represents about 2,300 workers on the Great Lakes and Canada's East and West coasts. Contract talks broke off in January and a conciliator has been appointed to try to help settle the dispute. The current contract expires at the end of March. The seafarers' employers are also asking for a reduction in crew levels, a move which the union said would cost about 400 jobs. Reuter 

REUTERS <RTRSY> IN REAL ESTATE MARKET VENTURE

Reuters Holdings PLC said its Reuters Information Services Inc unit will join <Real Estate Financing Partnership>, Philadelphia, to offer an electronic market access system for commercial property financing. Reuters said the system, named Real Estate Select View Program, or RSVP, will use its private communications network to provide a confidential method for the purchasing, selling and financing of commercial property. The system, set for testing in August in selected U.S. cities, is expected to be operational 90 days after initial testing, Reuters said. Reuter 

DALLAS CORP <DLS> 4TH QTR LOSS

Oper shr loss 22 cts vs profit 10 cts Oper net loss 1,626,000 vs pofit 702,000 Revs 98.3 mln vs 105.1 mln 12 mths Oper shr profit 18 cts vs profit 82 cts Oper net profit 1,293,000 vs profit 5,940,000 Revs 396.2 mln vs 396.7 mln Note: Oper net excludes loss from discontinued operations of 2,112,000 dlrs or 39 cts a share for year-ago qtr and 2,036,000 dlrs or 1.10 dlrs a share for year-ago 12 mths. Reuter 

CONSTRUCTION CONTRACTING DOWN THREE PCT IN JAN

Contracting for future construction work declined by three pct in January to an annualized rate of 236.1 billion dlrs, a report on the industry said. The report by the F.W. Dodge Division of McGraw-Hill Information Systems Co said a 10 pct reversal of nonbuilding construction was largely responsible for the month's setback from December's higher level. Residential building eased three pct in January, while contracts for commercial, industrial and institutional buildings rebounded slightly, according to the report. Nonbuilding construction, which soared to an annualized rate of 47.8 billion dlrs in December when last year's only major electric power plant was started, fell back 10 pct to 43.1 billion. Dodge said contracting for highway and bridge construction advanced five pct in January. However, available funding for 1987 construction could dry up if Congress fails to act after the Federal highway program runs out of carryover spending authority. Nonresidential buildings edged up one pct in January to an annualized rate of 77.6 billion. Contracting for institutional structures, such as schools and health facilities, was the reason for the gain, the report said. Residential building was valued at 115.4 billion dlrs in January, a decrease of three pct from December's seasonally adjusted rate, the report stated. However, demand will be strong for single-family units supported by falling mortgage rates, but multi-family buildings will not be in high demand as a result of the tax reform, according to the report. Reuter 

DILLARD DEPARTMENT STORES INC <DDS> 4TH QTR NET

Qtr ended Jan 31 Shr 1.16 dlrs vs 1.15 dlrs Net 32.4 mln vs 33.5 mln Revs 629.0 mln vs 538.6 mln Avg shrs 32.1 mln vs 29.2 mln 12 mths Shr 2.35 dlrs vs 2.29 dlrs Net 74.5 mln vs 66.9 mln Revs 1.85 billion vs 1.60 billion Avg shrs 31.7 mln vs 29.2 mln Note: Shr/avg shrs data show 2-for-1 split in Nov. 1985. Reuter 

EC MINISTERS BID TO SAVE DAIRY ACCORD

European Community (EC) farm ministers were fighting hard early today to prevent a deal on cutting overflowing milk production from turning sour before trying to agree widescale reforms in other surplus sectors. Meanwhile, protests from angry European farmers over successive attempts to scale down unwanted Community food production appeared to be gathering strength. In the northeastern Spanish city of Saragossa thousands of Spanish farmers battled with police during a march to demand a better deal from Brussels. The farmers traded stones for tear gas and rubber pellets and occupied local government buildings while in the southern city of Malaga, citrus growers dumped more 20 tonnes of lemons on the streets in protest at EC duties. Towards the end of last week, about 10,000 angry West German farmers marched through the streets of Hanover burning effigies of Agriculture Minister Ignaz Kiechle while in France pig-farmers barricaded roads in protest at falling prices. Europe's 12 mln farmers are furious over plans by the European Commission to cut subsidised prices and severely limit farmers' automatic right to sell unwanted food into public stores at high guaranteed EC prices. In the toughest-ever proposals for the annual price review, at which EC ministers set the levels of subsidies, Agriculture Commissioner Frans Andriessen has included measures that could result in price cuts for some products of up to 11 pct. The plans form part of an on-going campaign to reform surplus-creating farm policies that have become a political embarrassment at home and commercial flash-point abroad and threatened to leave the Community with no cash for other areas. Andriessen's latest package comes only months after a decision to cut dairy production by 9.5 pct over two years and to slash beef prices by around 10 pct. That decision, agreed in outline last December after virtually nine days of non-stop negotiations, was hailed as the most significant step yet in the reform offensive, but has since run into difficulties over the fine print. West Germany and Ireland are objecting to the new rules governing the sales of surplus butter into cold stores, but the Commission is loathe to abandon its position as the accord has been used as the inspiration for Andriessen's latest package. Ministers failed yesterday to overcome the problem, and resumed negotiations in a bid to finalise the details before starting the price review which is confidently predicted to last many months. EC farm spending currently swallows two thirds of an overall annual budget of around 40 billion dlrs and is almost entirely blamed for a projected budget shortfall later this year of some 5.7 billion dlrs. Reuter 

CALNY INC <CLNY> SUES PEPSICO INC <PEP>

Calny Inc said it has filed a multi-million-dlr suit against PepsiCo Inc and its La Petite Boulangerie unit. Calny, which holds 15 La Petite Boulangerie franchises, alleges it and PepsiCo breached their agreements with Calny by failing to support the franchises in a number of ways. The company further alleges that PepsiCo and La Petite Boulangerie had fiduciary responsibilities to Calny because of the longstanding relationship between Calny and Taco Bell, also a PepsiCo subsidiary. Calny operates 143 Taco Bell restaurants. Calny said Pepsico misrepresented the readiness of the La Petite Boulangerie to expand outside San Francisco and misrepresented costs involved in operating the restaurants. Reuter 

BRANIFF <BAIR> FEBRUARY LOAD FACTOR UP SLIGHTLY

Braniff Inc said its load factor, or precentage of seats filled, was 50.5 pct in February, up slightly from 50.2 pct for the same month last year. Braniff said traffic for the month rose 44 pct, to 210.5 mln revenue passenger miles, from 146.2 mln a year ago. A revenue passenger mile is one paying passenger flown one mile. The airline said capacity for February was up 43.3 pct, to 417.2 mln available seat miles, from 291.1 mln in 1986. Year to date, it said load factor was 50.5 pct vs 48.3 pct, traffic was 436 mln revenue passenger miles vs 295.4 mln and capacity was 863.3 mln available seat miles vs 611.4 mln. Reuter 

KENTUCKY CENTRAL LIFE <KENCA> SETS PAYOUT

Kentucky Central Life Insurance Co said it declared a semi-annual dividend of 55 cts per share, payable March 31 to shareholders or record March 19. The dividend is equal to the company's previous semi-annual payout. Reuter 

BANK OF NEW ENGLAND CORP <BKNE> QTLY DIVIDEND

Qtly div 28 cts vs 28 cts prior Pay April 20 Record March 31 Reuter 

JAPAN UNEMPLOYMNENT RISES TO RECORD IN JANUARY

Japan's seasonally adjusted unemployment rate rose to a record 3.0 pct in January, the worst since the Government started compiling unemployment statistics under its current system in 1953, up from the previous record 2.9 pct in December, the government's Management and Coordination Agency said. Unemployment was up from 2.8 pct a year earlier. Unadjusted January unemployment totalled 1.82 mln people, up from 1.61 mln in December and 1.65 mln a year earlier. Male unemployment in January remained at 2.9 pct, equal to the second-worst level set last December. Record male unemployement of 3.1 pct was set in July 1986. Female unemployment in January remained at 3.0 pct, equal to the record level marked in April, August, September and December last year. January's record 3.0 pct unemployment rate mainly stemmed from loss of jobs in manufacturing industries, particularly in export-related firms, due to the yen's continuing appreciation against the dollar, officials said. Employment in manufacturing industries fell 380,000 from a year earlier to 14.30 mln including 1.83 mln employed in the textile industry, down 190,000 from a year earlier, and 1.06 mln in transport industries such as carmakers and shipbuilders, down 170,000. REUTER 

FORD <F> EUROPE EARNINGS UP 71 PCT LAST YEAR

Ford Europe's net earnings soared by 71 per cent last year to 559 mln dlrs, Kenneth Whipple, chairman of Ford Europe, said. Whipple, here to attend the Geneva Auto Show which opens on Thursday, said that the Ford Motor Co unit had sold a record 1.5 million vehicles in Europe in 1986. Net earnings were 326 mln dlrs in 1985. Sales in 1986 represented 11.8 per cent of the European market share, Whipple said. Ford will invest 1.2 billion dollars in Europe in 1987, and a total of seven billion over the next seven years, he added. Reuter 

REAGAN'S CIA MAN WITHDRAWS, VICTIM OF IRAN SCANDAL

President Reagan's nominee as director of the Central Intelligence Agency (CIA), Robert Gates, withdrew his name from consideration by the Senate in the face of a long battle for confirmation. His withdrawal was announced at a White House news conference by Reagan's new Chief-of-Staff, Howard Baker, who said the President had accepted it with great regret. Gates, now deputy head of the CIA, had been questioned about CIA involvement in the Iran-contra scandal and leading senators had warned his nomination was in trouble. Baker said Gates would remain as deputy director of the spy agency. REUTER 

SOUTH KOREA'S LEADING INDICATORS FALL IN DECEMBER

South Korea's index of leading indicators fell 0.1 pct to 164.1 (base 1980) in December after a 0.1 pct rise in November, representing a 16.1 pct year-on-year gain from December 1985, Economic Planning Board provisional figures show. The index is based on 10 indicators which include export values, letters of credit received, warehouse stocks, M-1 and M-3 money supply figures and the composite stock exchange index. REUTER 

DENG SAYS CHINA'S TROUBLES OVER

Chinese leader Deng Xiaoping told visiting U.S. Secretary of State George Shultz China's recent troubles were over. The two discussed Washington's scandal over U.S. Arms sales to Iran and China's political situation after the fall of Communist Party leader Hu Yaobang. Deng said: "I know the President has had some difficulties but I think now it doesn't matter. When one is running a government one has to deal with troubles." "As for the troubles we recently encountered, they are over," Deng added. REUTER 

JAPANESE ECONOMIST SEES STABLE YEN/DOLLAR RATES

The yen should stabilize at around 152 to 153 to the U.S. Dollar for about a year, the Bank of Tokyo's economic adviser Koei Narusawa said. "Both sides are showing clear interest to secure stability of the currencies. The major target of the Japanese government is to maintain the yen at above 150, at least for the rest of the year," he told reporters during a brief visit to Malaysia. Narusawa said the U.S. Is unlikely to push the yen up further because this might spark off inflation and depress the U.S. Economy before the 1988 presidential election. The yen is trading at around 153.70 to the dollar. REUTER 

OPEC WITHIN OUTPUT CEILING, SUBROTO SAYS

Opec remains within its agreed output ceiling of 15.8 mln barrels a day, and had expected current fluctuations in the spot market of one or two dlrs, Indonesian Energy Minister Subroto said. He told reporters after meeting with President Suharto that present weakness in the spot oil market was the result of warmer weather in the U.S. And Europe which reduced demand for oil. Prices had also been forced down because refineries were using up old stock, he said. He denied that Opec was exceeding its agreed production ceiling. Asked what Opec's output level was now, he replied: "Below 15.8 (mln barrels per day)." He did not elaborate. He said there appeared to have been some attempts to manipulate the market, but if all Opec members stick by the cartel's December pricing agreement it would get through present price difficulties. He predicted that prices would recover again in the third and fourth quarters of 1987. He also reiterated that there was no need for an emergency Opec meeting. He said Opec had expected to see some fluctuations in the spot price. "We hope the weak price will be overcome, and predict the price will be better in the third and fourth quarters." Refiners, he said, appeared to have used up old stock deliberately to cause slack demand in the market and the price to fall. But Opec would get through this period if members stuck together. REUTER 

OFFICIAL INQUIRY SET FOR AUSTRALIAN WHEAT INDUSTRY

The government's industry aid and protection review body, the Industries Assistance Commission (IAC), will hold a 12-month inquiry into the Australian wheat industry, Primary Industry Minister John Kerin said. The IAC has been asked to report on the need for assistance to the industry and the nature, duration and extent of any aid, he said in a statement. He said the inquiry will be the first step in setting marketing arrangements to apply after June 30, 1989, when the underwriting and pricing provisions of the 1984 Wheat Marketing Act expire. Kerin said the broad-ranging reference would allow a full examination of all aspects of the wheat-marketing system. "The inquiry will be required to take into account changes which have taken place in the industry as a result of the agricultural policies of major wheat producing countries and the industry's capacity to adjust to any recommended changes," he said. "The inquiry is at an important time for the wheat industry, as the substantial fall in world prices is likely to trigger underwriting support from the government for the first time," he said. Kerin was referring to the government's underwriting of the guaranteed minimum price paid to wheatgrowers by the Australian Wheat Board near the start of the season. The IAC's report will be due at the same time as the findings of the current Royal Commission into Grain Storage, Handling and Transport, Kerin said. He said the timing of the IAC inquiry would allow its findings and those of the Royal Commission to be considered in later negotiations on wheat-marketing arrangements between the federal and state governments and the industry. REUTER 

COFFEE TRADERS EXPECT SELLOFF AFTER ICO TALKS FAIL

The failure of the International Coffee Organization (ICO) to reach agreement on coffee export quotas could trigger a massive selloff in London coffee futures of at least 100 stg per tonne today, coffee trade sources said. Prices could easily drop to as low as 1.00 dlr or even 80 cents a lb this year from around 1.25 dlrs now, they said. A special meeting between importing and exporting countries ended in a deadlock late yesterday after eight days of talks over how to set the quotas. No further meeting to discuss quotas was set, delegates said. Quotas, the major device used to stabilize prices under the International Coffee Agreement, were suspended a year ago after prices soared following a damaging drought in Brazil. With no propects for quotas in sight, heavy producer selling initially and a price war among commercial coffee roasting companies will ensue, the trade sources predicted. Lower prices are sure to trickle down to the supermarket shelf this spring, coffee dealers said. The U.S. And Brazil, the largest coffee importer and exporter respectively, each laid the blame on the other for the breakdown of the talks. Jon Rosenbaum, U.S. Assistant trade representative and delegate to the talks, said in a statement after the council adjourned, "A majority of producers, led by Brazil, were not prepared to negotiate a new distribution based on objective criteria. "We want to insure that countries receive export quotas based on their ability to supply the market, instead of their political influence in the ICO." Brazilian Coffee Institute (IBC) President Jorio Dauster countered, "Negotiations failed because consumers tried to dictate quotas, not negotiate them." Previously, quotas were determined by historical amounts exported, which gave Brazil a 30 pct share of a global market of about 58 mln 60-kilo bags. A majority of producers wanted quotas to continue under this basic scheme. But most consumers and a maverick group of eight producers proposed carving up the export market on the basis of exportable production and stocks, which would reduce Brazil's share to 28.8 pct. Consumer delegates said this method would reflect changes in many countries' export capabilities and make coffee more readily available to consumers when they need it. A last-minute attempt by Colombia, the second largest exporter, to rescue the talks with a compromise interim proposal could not bring the two sides together. Delegates speculated Brazil's financial problems, illustrated by its recent suspension of interest payments on bank debt, have increased political pressure on the country to protect its coffee export earnings. Developing coffee-producing countries that depend heavily on coffee earnings, particularly some African nations and Colombia, are likely to be hurt the most by the ICO's failure to agree quotas, analysts said. The expected drop in prices could result in losses of as much as three billion dlrs in a year, producer delegates forecast. The ICO executive board will meet March 31, but the full council is not due to meet again until September, delegates said. REUTER 

EC MINISTERS POSTPONE TALKS ON SAVING DAIRY PACT

European Community (EC) farm ministers early today abandoned talks aimed at saving an agreement on cutting excessive milk production after making no progress in over 12 hours of negotiations. The ministers will resume talks at 10.00 local time in a bid to clear the way for a full-scale review of proposed reforms for other surplus sectors. Diplomats said member states were unable to settle differences over new rules limiting farmers' automatic right to sell unwanted butter at high guaranteed prices into EC cold stores. West Germany and Ireland are opposed to the steps. REUTER 

REAGAN APPROVAL RATING FALLS TO FOUR-YEAR LOW

President Reagan's approval rating fell after the Tower Commission criticised his handling of the Iran arms scandal, a New York Times/CBS poll indicates. The poll found 51 pct of those surveyed thought he was lying when he said he did not remember if he had approved the original arms sales to Iran and 35 pct thought he was telling the truth. The poll found 42 pct of those surveyed approved Reagan's handling of his job and 46 pct disapproved. The approval rating was the lowest since January 1983, when 41 pct approved of the way Reagan was doing his job. REUTER 

EARTHQUAKES CONTINUE TO SHAKE NORTHERN NEW ZEALAND

Earthquakes and aftershocks are still shaking areas of northern New Zealand following yesterday's strong tremor which left 3,000 people homeless. Four earthquakes measuring up to 4.5 on the Richter scale have hit the Bay of Plenty and Waikato region in the north-east since midnight yesterday (1200 GMT). No casualties have been reported and no further major damage, civil defence sources said. Twenty-five people were treated for bone fractures after yesterday's shock. A government seismologist said from Rotorua in the North Island some five tremors were being recorded every 10 minutes. Today's quakes were felt over an area of 100 square km, the seismologist added. A state of civil defence emergency in the area was declared yesterday and is still in force, with schools closed and access to the worst-hit towns of Edgecumbe, Whakatane and the forestry town of Kawerau severely restricted. Yesterday's quake measured 6.25 on the Richter scale. The seismologist said if the pattern of other large earthquakes was followed the shocks would continue for one to several weeks, declining in frequency and magnitude. But the chance of a further large shock could not be ruled out. Civil defence officials said major roadslips and landslides in the area are being cleared, with power and water restored to most areas. Rail lines twisted by earth movements are being repaired. Prime Minister David Lange visited the region today before flying to Auckland to attend a South Pacific Forum conference of foreign ministers. A small force of troops was moved into the area to assist civil defence workers and volunteers. Civil defence sources said people would shortly begin to return to their homes when the buildings are declared safe. REUTER 

CRA Ltd 1986 net profit 138.2 mln dlrs vs 87.8 mln

N.Z. QUARTERLY CURRENT ACCOUNT DEFICIT NARROWS

New Zealand's current account deficit for the quarter ended December 31, 1986 narrowed to 567 mln dlrs from 738 mln, revised down from 742 mln, for the September quarter and from 733 mln a year earlier, the statistics department said. The deficit for the year ended December narrowed to 2.75 billion dlrs from 2.91 billion dlrs, revised down from 2.92 billion, for the year ended September. The deficit for calendar 1985 was 2.61 billion. The December quarter showed a 182 mln dlr surplus for merchandise trade, unchanged from the September quarter surplus which was revised down from 271 mln dlrs. The 1985 December quarter showed a 13 mln dlr deficit. Imports for the December 1986 quarter were 2.655 billion against 2.883 billion in the September quarter and 2.454 a year earlier. Exports were 2.837 billion against 3.065 billion and 2.440 billion. Imports for the year ended December 1986 were 10.74 billion dlrs compared with 11.14 billion in 1985. Exports were 11.20 billion against 11.36 billion. Government borrowing stood at 9.26 billion dlrs for calendar 1986 against 3.15 billion for 1985. Borrowing in the December quarter rose to 3.92 billion from 1.79 in the September quarter and 611 mln a year earlier. Repayments stood at 5.5 billion for the year, up from 3.1 billion in 1985. Repayments in the December quarter accounted for 1.4 billion dlrs against 260 mln in the September quarter and 334 mln a year earlier. Official reserves totalled 7.205 billion dlrs at end December compared with 4.723 billion at end September and 3.255 billion one year earlier. REUTER 

AMERICAN AIRLINES TO ANNOUNCE BUYS, NEWSPAPER SAYS

<American Airlines Inc> is expected to announce purchases from <Airbus Industrie>, Boeing Co <BA> and General Electric Co <GE> amounting to 2.5 billion dlrs, the New York Times said. The paper quoted unnamed industry sources as saying American will buy 25 wide-bodied planes from Airbus, 15 wide-bodies from Boeing and 80 engines from GE. It said American split the order between Airbus and Boeing to get better prices and conditions. It said the 80 CF6-80C2 engines are worth more than five mln dlrs each. REUTER 

TRANSAMERICA SELLS OCCIDENTAL LIFE AUSTRALIA

Equity investment company <Battery Group Ltd> said it had agreed to buy <Occidental Life Insurance Co of Australia Ltd> from TransAmerica Corp <TA> of the U.S. For 105 mln Australian dlrs. The acquisition has been made possible by the efforts of its major shareholder, <Pratt and Co Financial Services Pty Ltd>, Battery Group said in a statement. The purchase will be partly funded by the issue of eight mln shares at 4.50 dlrs each and four mln free options to the Pratt Group, controlled by entrepreneur Dick Pratt, plus four mln shares to professional investors at 4.50 each, it said. The balance will be funded by debt, Battery Group said. The acquisition is subject to the approval of its shareholders. On completion of the share placements, Pratt Group will effectively have 51 pct of Battery's enlarged capital, assuming exercise of all options, it said. Battery now has 22 mln shares on issue. Battery said Occidental Life is a major underwriter of individual term life insurance and a recent but fast-growing entrant in the individual account superannuation market. It has some 200 mln dlrs in funds under management. REUTER 

CRA LTD <CRAA.S> 1986 NET

Net 138.20 mln dlrs vs 87.80 mln. Shr 24.8 cents vs 17.8 Final div to announced after July 1, vs final 10 cents making 15. Sales revenue 4.81 billion vs 4.69 billion Investment income 116.93 mln vs 60.61 mln Shrs 494.35 mln vs 494.22 mln. NOTE - Net is after tax 171.03 mln dlrs vs 188.52 mln, interest 337.39 mln vs 308.68 mln, depreciation 352.32 mln vs 333.05 mln but before net extraordinary loss 250.28 mln vs profit 28.03 mln. REUTER 

MALAYSIA RE-IMPOSES EXPORT DUTIES ON RUBBER

The Malaysian government said it has re-imposed export duties on rubber at 3/8 cent per kilo after the gazetted price moved above the threshold price of 210 cents per kilo. The gazetted price, effective March 1, rose to 213-1/2 cents per kilo from February's 207. The duty for research remains at 3.85 cents per kilo and the replanting duty is also unchanged at 9.92 cents. REUTER 

MALAYSIA RAISES DUTY ON PROCESSED PALM OIL

The government said it raised the export duty on processed palm oil (PPO) to 64.06 ringgit per tonne from 40.96 ringgit, effective from March 1. Export duty on crude palm oil (CPO) was unchanged at 16.06 ringgit per tonne. The gazetted price of PPO rose to 796.8604 ringgit per tonne from 719.8286. That of CPO remained at 617.8238 ringgit. The export duty and gazetted price of palm kernel were left unchanged at 191.15 and 955.75 ringgit per tonne respectively. REUTER 

comalco ltd 1986 net profit 57.1 mln dlrs vs loss 69.1 mln

COMALCO LTD <CMAC.S> 1986 NET

Net profit 57.1 mln dlrs vs loss 69.1 mln. Net is equity accounted Pre-equity accounted net 39.90 mln dlrs vs loss 49.11 mln Pre-equity shr profit 7.1 cents vs loss 8.7 Final div to be announced after July 1 vs first and final 1.0 cent. Sales 1.88 billion vs 1.78 billion Other income 52.75 mln vs 15.22 mln Shrs 560.61 mln vs same. NOTE - Net is after tax paid 46.85 mln dlrs vs credit 5.02 mln, interest 127.68 mln vs 117.19 mln, depreciation 109.29 mln vs 100.73 mln and minorities 1.50 mln vs loss 331,000. But net is before net extraordinary loss 140.5 mln vs nil. Extraordinaries comprise exchange losses 102.9 mln, provision for Goldendale smelter closure costs 27.3 mln and increase in future tax provision 10.3 mln. REUTER 

JAPANESE DEMAND FOR U.K. GILTS SEEN RISING

Japanese investor interest in British gilt-edged securities is growing rapidly due to expectations sterling will remain stable despite the drop in oil prices, and on calculations gilt prices will firm, bond managers said. Japanese, British and U.S. Securities houses have been expanding inventories of gilts to meet demand from investors seeking capital gains, including city and trust banks, which have been active on the U.S. Treasury market, they said. Dealing demand for gilts with coupons around 10 pct has been getting stronger, the general manager of the local office of a British securities firm said. On the other hand, major long-term investors such as Japanese insurance companies are not very enthusiastic about buying British securities ahead of the March 31 close of the Japanese financial year, traders said. These investors, who must convert yen into sterling through dollars for British securities purchases, appear to be buying in London rather than in Tokyo, a bond manager for a British securities house said. The sterling/yen rate was about 240.34/44 today, up from 234.50 at the start of the calendar year and a narrow range of 230 to 234 late last year. Many bond traders in Tokyo are doubtful that sterling will further appreciate steeply. However, gilts may benefit from further declines in U.K. Interest rates, they said. "The U.K. Government is in no hurry to issue more bonds, suggesting further market improvement and continuing demand from brokers here," said Laurie Milbank and Co assistant manager Machiko Suzuki. She said she expected the yield on the actively traded 11-3/4 pct gilt due March 2007 to dip below 9.5 pct, against 9.581 pct at yesterday's close in London. REUTER 

JAPAN'S UNEMPLOYMENT RATE SEEN RISING TO 3.5 PCT

Japan's unemployment rate is expected to continue to climb to about 3.5 pct within the next year from January's three pct record, senior economists, including Susumu Taketomi of Industrial Bank of Japan, said. December's 2.9 pct was the previous worst level since the government's Management and Coordination Agency began compiling statistics under its current system in 1953. "There is a general fear that we will become a country with high unemployment," said Takashi Kiuchi, senior economist for the Long-Term Credit Bank of Japan Ltd. The government, which published the January unemployment figures today, did not make any predictions. "At present we do not have a forecast for the unemployment rate this year, but it is difficult to foresee the situation improving," a Labour Ministry official said. Finance Minister Kiichi Miyazawa said the government had expected the increase and had set aside money to help 300,000 people find jobs in fiscal 1987 beginning in April. Prime Minister Yasuhiro Nakasone told a press conference the record rate underlines the need to pass the 1987 budget which has been held up by opposition to proposed tax reforms. The yen's surge has caused layoffs in the mainstay steel and shipbuilding industries. Other export-dependent industries, such as cars and textiles, have laid off part-time employees and ceased hiring, economists said. Although the growing service industry sector has absorbed a great number of workers the trend is starting to slow down, said Koichi Tsukihara, Deputy General Manager of Sumitomo Bank Ltd's economics department. However, other economists disagreed, saying the service sector would be able to hire workers no longer needed by the manufacturing sector over the next five years. The economists said the service sector should grow as the government stimulates domestic demand under its program to transform the economy away from exports. Although Japanese unemployment rates appear lower than those of other industrialised nations, methods for calculating statistics make them difficult to compare, economists warned. "The three pct figure could translate into a relatively high figure if European methods were used," one economist said. More than half of January's 170,000 increase in jobless from a year earlier were those aged between 15 and 24, Sumitomo's Tsukihara said. REUTER 

SOUTH KOREAN TRADE SURPLUS NARROWS IN FEBRUARY

South Korea's customs-cleared trade surplus narrowed to 110 mln dlrs in February from 525 mln in January, provisional trade ministry figures show. In February 1986 there was a deficit of 264 mln dlrs. February exports rose to 2.87 billion dlrs, fob, from 2.83 billion in January and 2.30 billion in February 1986. CIF imports were 2.76 billion against 2.31 billion in January and 2.57 billion in February last year. REUTER 

TAIWAN REJECTS TEXTILE MAKER PLEA ON EXCHANGE RATE

Central bank governor Chang Chi-cheng rejected a request by textile makers to halt the rise of the Taiwan dollar against the U.S. Dollar to stop them losing orders to South Korea, Hong Kong and Singapore, a spokesman for the Taiwan Textile Federation said. He quoted Chang as telling representatives of 19 textile associations last Saturday the government could not fix the Taiwan dollar exchange rate at 35 to one U.S. Dollar due to U.S. Pressure for an appreciation of the local currency. The Federation asked the government on February 19 to hold the exchange rate at that level. The federation said in its request that many local textile exporters were operating without profit and would go out of business if the rate continued to fall. It said the Taiwan dollar has risen almost 14 pct against the U.S. Dollar since September 1985 while the South Korean won climbed only four pct. The Singapore and Hong Kong dollars remained stable against the U.S. Unit in that period, it said. Many local bankers and economists predict Taiwan's dollar will rise to between 32 and 33 per U.S. Dollar by year-end. Chang was quoted as saying this would depend on Taiwan's ability to reduce its trade surplus with the U.S. This year. The surplus widened to a record 13.6 billion U.S. Dlrs in calendar 1986 from 10.2 billion in 1985, official figures show. Taiwan's textile exports fell by almost four pct in January to 562 mln U.S. Dlrs from 583 mln in January 1986, the same figures show. Textiles are Taiwan's second-largest export earner, after electrical and electronic products. Textile exports surged to 7.8 billion U.S. Dlrs last year from 6.2 billion in 1985. Exports to the U.S. Last year were worth 2.8 billion U.S. Dlrs. REUTER 

EGYPT ALLOWS FUGITIVE LIBYANS STAY

Egypt allowed five fugitive Libyan soldiers who landed in a military plane in the far south of the country last night to stay and flew them to Cairo, official sources said. It appeared the government had agreed to demands by the five -- two officers and three privates -- for political asylum but there was no immediate announcement. Official sources said Egyptian servicemen flew the Libyans north from Abu Simbel in their C-130 transport plane. The status of the sixth Libyan on board, the pilot, was not immediately known. REUTER 

U.S. ASKS JAPAN TO END AGRICULTURE IMPORT CONTROLS

The U.S. Wants Japan to eliminate import controls on agricultural products within three years, visiting U.S. Under-Secretary of State for Economic Affairs Allen Wallis told Eishiro Saito, Chairman of the Federation of Economic Organisations (Keidanren), a spokesman for Keidanren said. The spokesman quoted Wallis as saying drastic measures would be needed to stave off protectionist legislation by Congress. Wallis, who is attending a sub-cabinet-level bilateral trade meeting, made the remark yesterday in talks with Saito. Wallis was quoted as saying the Reagan Administration wants Japanese cooperation so the White House can ensure any U.S. Trade bill is a moderate one, rather than containing retaliatory measures or antagonising any particular country. He was also quoted as saying the U.S. Would be pleased were Japan to halve restrictions on agricultural imports within five years if the country cannot cope with abolition within three, the spokesman said. Japan currently restricts imports of 22 agricultural products. A ban on rice imports triggered recent U.S. Complaints about Japan's agricultural policy. REUTER 

JAPAN MOVES TO TIGHTEN CHIP-EXPORT CURBS

The Ministry of International Trade and Industry (MITI) acted to tighten restrictions on microchip exports to countries other than the U.S. To preserve a U.S.-Japan pact on semiconductor trade, but major Japanese chipmakers doubt its usefulness. A MITI spokesman said his ministry had asked chipmakers to issue certificates to specified trading houses stating they are authorised exporters. Trading houses applying for a MITI export licence will be required to show such a certificate, but those without it will not automatically be denied licences, he said. But some industry officials predicted any government measures were likely to have limited effect as long as the world semiconductor market remained weak. U.S. Government and industry officials have complained repeatedly that Japanese chipmakers continue to sell at below cost to third countries despite the July agreement. Japanese firms and officials in turn argue the flow of cheap chips to third countries is due to grey-market sales by third-party brokers, who seek to profit from the gap between low prices in Japan and higher prices based on production costs and set for Japanese makers under the agreement. The MITI spokesman said, "If the percentage of grey market is increasing for one specific company, it suggests they are distributing their products through their sales network knowing they will be exported by some means. In that case we will ask them what they are doing to reduce the figure." MITI earlier asked makers to cut output of certain chips by 10 pct in first-quarter 1987, spokesmen for the firms said. But they doubt the usefulness of the latest move. "As long as there is a gap between prices set under the pact and market prices, there will be people who want to exploit the gap to make money," a Hitachi Ltd <HIT.T> spokesman said. REUTER 

FINNISH UNEMPLOYMENT AT 6.7 PCT IN DECEMBER

Finnish unemployment was 6.7 pct in December last year compared with 6.8 pct in November and 6.1 pct in December 1985, the Central Statistical Office said. It said 173,000 people were unemployed in December 1986, 174,000 in November and 157,000 in December 1985. REUTER 

BANKERS SEE SHARP RISE IN THAI FOREIGN RESERVES

Thailand's improving economy will likely cause foreign reserves to increase to at least five billion dlrs by end-1987 from a record of nearly 4.2 billion at end-February, private bankers said. Bank of Thailand statistics show foreign reserves rose to 3.95 billion at end-January from 3.03 billion a year earlier. Nimit Nonthapanthawat, chief economist at the <Bangkok Bank Ltd>, said Thailand's strong export performance, its relatively high interest rates, foreign participation in its stock market, and growing foreign investment, especially from Japan, contributed to the projected sharp rise. Thai exports rose 19.4 pct in 1986 and are expected to expand another 15 pct this year, bankers said. A U.S. Embassy report said last month Thailand could achieve five pct real gross domestic product growth in 1987, up from a projection of 3.8 pct for 1986 and 3.7 pct in 1985. Nonthapanthawat said if economic growth continues at its current pace and oil prices and major currencies remain stable the five billion 1987 reserves target can easily be reached. Thailand calculates foreign reserves to include gold, special drawing rights and convertible currencies. The target is equivalent to five-and-a-half months' worth of imports. REUTER 

SWEDEN HAS CURRENT PAYMENTS SURPLUS IN 1986

Sweden had a 1986 current balance of payments surplus of 7.6 billion crowns compared with a deficit of 10.1 billion the preceding year, according to preliminary figures from the central bank. The December current account had a 100 mln crowns deficit against a yearago 200 mln deficit.December trade balance was 2.3 billion surplus against yearago two billion. The trade balance showed a 1986 surplus of 33.2 billion crowns compared with a 15.8 billion surplus in 1985, the bank said . REUTER 

NEUTRAL BUDGET EXPECTED IN SINGAPORE

Singapore's Finance Minister Richard Hu is expected to announce a neutral budget tomorrow with no major tax changes for the 1987/88 year starting April 1, bankers and economists told Reuters. They said with real growth at an estimated 1.9 pct in calendar 1986, indicating signs of recovery from the 1.7 pct shrinkage in 1985, the government was likely to hold its course and wait for measures introduced in last year's budget to work. Last March Hu cut corporation tax to 33 pct from 40 pct, and income tax was reduced by the same margin. Last year the government also reduced wage costs by introducing a wage freeze and cutting employer contributions to the mandatory state savings scheme, the Central Provident Fund (CPF), to 15 pct of salaries from 25 pct. "I don't foresee any new or additional stimulus because the economy is now improving," said Clemente Escano, vice president of the Union Bank of Switzerland. The government's economic report for calendar 1986, issued last week, said the CPF reduction and other cost-cutting measures only started to bite in the third quarter of 1986. But the report said over half the economy -- especially the commerce, financial, and business services sectors -- continued to be depressed by weakness in the surrounding regional economies and an excess of domestic property. The sources said the fragility of the economic recovery suggested the government would not introduce much of its planned consumption tax in the coming financial year. In last year's budget Hu said he planned to set up collecting machinery for the tax. Economists said a campaign against smoking this year might be the opportunity for him to levy the tax on tobacco as a first step towards its wider use. The sources said the government does not look likely to raise more revenue in this year's budget. Last year's budget projected a 3.22 billion dlr budget deficit for fiscal 1986/87, but the economic report projected an overall calendar 1986 surplus of three billion. Lower tax revenue was balanced by rising investment income and stringent controls on government operating expenditure, helped by the wage-freeze policy. Anthony K.P. Lee, vice-president and deputy general manager of American Express Bank Ltd, said he expected nothing exciting from this year's budget. Lee said, "It will probably be a non-event as most of the tax benefits were given last year. The economy has already started moving so it does not need government support." Last week's economic report attributed the one pct decline in domestic demand last year mainly to a sharp decline in private construction, so this sector hopes for some relief from the budget, economists said. The economic report said the sector's activity declined by 25.3 pct in calendar 1986 after a 13.9 pct contraction in 1985. A further decline is expected in 1987. But in last year's budget a 30 pct rebate on tax for industrial and commercial properties was raised to 50 pct until the end of 1988, so the most Hu is likely to do is add incentives for creating property investment unit trusts. The only measures known to be in tomorrow's budget are incentives to encourage population growth, including incentives to families who have three children. Deputy Prime Minister Goh Chok Tong has already announced the government will try to encourage three-child families, instead of the two-child families it encourages now. REUTER 

FISONS PLC <FISN.L> YEAR TO END-1986

Shr 27.5p vs 24.3p Div 3.95p vs 3.34p making 6.5p vs 5.5p Pre-tax profit 85.1 mln stg vs 72.3 mln Turnover 702.6 mln vs 646.7 mln Tax 18.4 mln vs 15.2 mln Finance charges 4.1 mln vs 5.4 mln Minority interest 0.1 mln vs 0.5 mln Extraordinary debit, being closure and restructuring costs 4.9 mln vs 3.7 mln Operating profit includes - Pharmaceutical 49.8 mln vs 39.0 mln Scientific equipment 23.2 mln vs 19.2 mln Horticulture 8.0 mln vs 8.7 mln Note - company said it plans one-for-one capitalisation REUTER 

MAJOR SWISS BANKS RAISE CUSTOMER TIME DEPOSIT RATES 1/4 POINT TO THREE PCT - CREDIT SUISSE